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tv   Fast Money Halftime Report  CNBC  July 2, 2019 12:00pm-1:00pm EDT

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wing politicians >> earlier you were talking about how it's trying to be progressive and not political, finding that a hard line to walk >> correct they would say when they had colin kaepernick do the ads, they were just saying chase your dream. obviously people interpreted it differently. >> ladies, great to have you here for the hour. that's going to do it for "squawk alley. let's get over to scott wapner and "the half. thank you, i'm scott wapner. front and center, apple leading the dow in the past month, up again today. can it get back to a new high? it's 12:00 noon. this is "the halftime report." apple's run, up 15%, but still 13% off its high set nine months ago after a big departure in the executive ranks, what will it take to get this stock higher? plus the dow is now 200 points from an all-time high are we in danger of a sell the
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news drop? plus a big call in the financial space just aheard of earnings and we're holding the investment committee's feet to the fire with the quarterly report "the halftime report" with scott wapner begins right now. welcome, good to have you with us on this tuesday. joe terranova, steve white, jon najarian, and richard sapperstein is here, high towerer ceo. shares of apple on the move today, down 16% from its all-time high. doc, your biggest stock position, people say what's going to get stocks to break out of this range, we're finally starting to move that next leg higher apple hitting that new high wouldn't hurt. >> it wouldn't hurt. as they basically cross the billion sales number as far as units out there in the field, scott, a billion hand-heads out
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there, that's huge for apple in terms of the services revenue that pete is always harping about. the issue for me is also that a lot of the services they're selling now are bigger services, recurring revenue, for instance, from like the cloud and so forth, scott that is huge i bet virtually everybody here on the desk is paying that extra dollars per month to have that cloud storage. imagine that multiplied across a billion units. >> you've got jony ive leading, iphone sales slower than they once were, china trade, all the issues on that side of the business you've got a considerable part of revenue from that are those headwinds, are no? >> they're headwinds in terms of what you'll hear on the conference call from tim cook. >> $30 from its all-time high. >> okay. and i have stated not that i
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believe that the faang's are going enclosure, but i believe you did not have to be in the faang's to get the appreciation of technology that you could get out of some other names, names like motorola solutions which is performing very well but you're talking about apple being $30 above the all-time high yes, that's the high from 2018 >> the low >> the low how about getting back above the may 1st high in 2015 in may apple went from 215 to 170, that's a 18% decline, because of the concerns as it related to was there going to be a brand image problem in china now, the question becomes was some fundamental damage done in china? the evidence suggests yes, possibly, it was so you might be looking at a valuation and a price for apple that is pricing in exactly where it should be we will not know the answer to that until tim cook tells us on the conference call how the business has looked in china >> weiss, how do you see this?
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>> i see it as i want to be short in the earnings. i bought some puts today, very small. >> you're effectively short apple? >> no, i'm still long apple. i still have my stock position i don't want to sell that and pay taxes. but i do think the quarter is going to be disappointing. i think the new service they launched is going to be disappointing. i think it's going to get very little traction. they haven't -- jony ive -- >> who cares about the news service? is that driving the needle >> it's services, it's supposed. they're supposed add more and more services. they need services to reaccelerate not that it's not growing, it's still growing. so yes, the news service is important. so look, so i think that handsets don't tell you what they are anymore, will be disappointing. i think china is an issue. so look, the stock rose not because of fundamentals. it rose because the market rose
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and because it's a component of every index. and with -- >> maybe it rose because in part of the fundamentals weren't judged to be as bad as some thought they might be. >> right >> and i think that's a mistake in judgment. >> i don't agree with you. i think that apple was an inexpensive stock that was trading for below market multiple up to 15 times earnings if you look at it, where it is right now, it's right above its 50-day moving average, over its 200-day. it looks technically as if it's posed to go higher >> for this breakout >> that's what it looks like the only thing that i think can derail it is if the guidance is really weak, which is unlikely the market and investors have understood that this tariff is going to have an effect on the current quarter and perhaps the next quarter and if they can stick with where guidance is, i think the stock will trade higher for the next few months >> let me ask you, why should this company, and it's a great
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brand, i own the shares -- let me finish -- why do you think -- you're saying below multiple, which means you bought it or you want to own it because it should be at market multiple or above >> yes >> so we are agree on that why should a company that has negative earnings should be at a market multiple? you have the s&p growing at a certain level, that gives you your market multiple then you have companies that are slowing in earnings and particularly when their core business is slowing markedly, why should that give you market multiple >> i think the stock, both trades on the acceleration of the china business, on the service business -- >> which fell off again. >> yeah, but you have to look forward. >> i am looking forward. >> let's go to some numbers here, okay as jon said, there's 1.4 billion handsets younoutstanding. >> right >> they're averaging $2,000 a month in services per unit their plan is to double, and there are several strategies
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they have to increase that they have a 63% margin on that business versus the hardware which is only a 30% margin as the services grow we'll see margins increase if you look at the free cash flow of this company, it's almost 7%. they bought back $70 billion worth of stock last year >> so the stock is where it is >> you know what, it's a core holding for me, all right? love the company the ecosystem, the financials, the balance sheet, i think it's a cash cow that should be a core holding in everyone's portfolio. >> the leadership? >> okay, so people are going to come and go in every company, okay in the long term, sure, that could be an issue. no, i'm suggesting that -- >> you've left that out as a positive the only people at the desk who has an issue is that guy, weiss. >> and i'm the most insightful person >> we know that. >> we've heard that before
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>> jony ive, here's jony ive, johnny live is leaving, he's the design chief "the wall street journal" writes this piece that says that ive had grown frustrated with cook's leadership and alleged lack of interest in the design/production process, to which cook responded, which he rarely responds to this type of stuff. he called that story absurd. quote, a lot of the reporting and certainly the conclusions don't match the reality. so we made the point the other day that with all due respect to jony ive, the notion that ive is the only person in that that beautiful new building that knows how to design anything -- >> ludicrous >> absurd. >> ludicrous i agree with that. there's a strong management team there. and i think the conversation, the direction of what apple does, comes down to you philosophically, do you believe there's perceived weakness
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because of a slowdown related to a trade dispute with the chinese, and in addition to that, is there a fundamental slowdown in the business >> i feel like cook -- when cook told you, what was it, like a month ago now, when he said things in china had got enbetter, whenever that was, it sort of tipped the hand. are we expecting that you're going to get a big negative? >> correct right. >> in the next earnings? >> so therefore you have to believe that the fundamentals of the business is contracting, which i don't, i disagree. i don't believe that's in contraction. >> the earnings speak for themselves >> let's be clear. >> the earnings are down >> the iphone numbers, which are core to the business, are not what they were and may never be what they were in terms of the growth rate. >> they don't have to be >> exactly >> from an historically high level. >> how can you say it's not deteriorating when the earnings are down
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that defines deterioration >> but it is contracting from a high level, okay i would argue that it's a transitory contraction the business can reaccelerate once again, can it not >> my point is doesn't the acceleration -- the acceleration is now relied on from another part of the business, right? the services side of the business relative to the hardware side; is that right are you expecting -- >> that's correct, but i don't believe the phone business is in, as steven just said, a secular design i think it's cyclical, it reaccelerates. >> it's improving to a service business which has a higher margin we talk about the multiple the global macro headwinds are reflected in the multiple. >> it's not always been a below market multiple. but at the end, okay, it's an electronics manufacturer
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they manage consumer products. >> agreed. they're buying back 7% of the float every year >> how many companies are sitting with $200 billion at 25 basis points, right, instead of going out and making acquisitions that could be meaningful >> that's a good point that's fair. you're right about that. >> that's my issue with tim cook >> who should they go out and spend all that money on? >> i don't know. but take a look. take a look what zuckerberg has done with his cash those were all available to apple, right instagram. any of those take a look at netflix, when it was a $50 billion -- maybe they wouldn't have sold take a look at what disney has done and what the stock has done since. >> you're right on the cash. >> i'm right on the lack of vision of the leadership >> i don't think you can make a case that apple is never going to bring to the market the product that has the wow factor that the iphone had. >> but they haven't in 12 years.
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>> do you think the watch is going to do it >> the wearable, i think that has momentum >> says the guy who sat down on the set with the air pods in his ear. >> i think that was phenomenal >> how do you like your new ipad >> it replaced the old one it doesn't have many more innovations. >> but you you bought a new one. >> services, just to be clear, and now we've got coming up at the end of july, services in the last quarter were $11.5 billion up from under $4 billion just 2 1/2, 3 years ago you look at this thing, and it's up to 20% of revenue right now, not 17 anymore it's 20% and going to be moving higher. and as i tell you, as we cross this billion-user threshold that we have now, i believe that these services numbers are going to crush and to your point, rich, these
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are margins that are obscene on the services side, scott that's why i'm so bullish. that's why i hang out, if people want to bash it, let them bash it this thing is going higher does it have to crash through $232 a share maybe. i just think it just keeps going. >> that's not that far from here >> that's the point. i was about to say, it's not that far from here and we talked about last week how the market is really flat for 18 months. and so we're talking about apple, which is trading up and down you know, it's really done nothing for a year or more and you could say that if the market begins to pick up from here, so it has 10% more to go, if earnings pick up in the second half, why shouldn't apple participate in that growth if the china deal has happened? >> or if apple -- you can frame it the other way too, which we have before, if apple picks up
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momentum, there's no reason the market wouldn't either maybe you have to wait until earnings get a boost to help lift all boats but it's not like technology as a space isn't helping the market move higher. we do our stock survey and where do people say you want to be >> tech. >> 84% say tech. >> for the market to move higher, we have to have tech participate. if you look at where earnings might grow faster than expectations over the next couple of quarters, you know it's not going to be financials because interest rates are too low. it can't be health care because they don't want to report great earnings because they'll attract too much attention you look at energy, it's been weak, too much production. consumer struggles, retail struggles. if the market is going to go higher, it has to be on the back of consumer discretionary technology >> largely the faang's have been
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beaten by other areas of tech. >> or when you have the president and the doj saying, hey, we're going to go after facebook, google, twitter, a lot of these social media and/or broadcast names over the internet, that's a big thing look where xlk is still, up 27, 28% year to date, double what the dow is up year to date, scott. >> there's also no marginal buyer. who is the marginal buyer? core position, i don't know if it's core position -- core position for apple, who is the marginal buyer alphabet i have alphabet, i've sold a little, i may sell the rest because they're not going to report great earnings either >> that's a good point >> who wants to come in. with the smaller companies, you get a marginal buyer everybody in the world knows the services story everybody in the world is
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bullish as jon >> is everybody fully invested >> no. >> you're not. >> i'm able to distinguish the star search, right >> you still own the shares, though >> i have a small position you own the shares >> you're the marginal buyer >> no, i'm not >> steve is the marginal buyer >> i don't own the shares, and i'm arguing you need more visibility i'm not saying the stock is going down, jon. i just think the stock, there are other -- >> why don't you own the shares? >> because first of all, when jimmy didn't buy it, i bought it down at 150. >> why would you use apple as the trading stock? >> does apple have to shift their manufacturing out of china? does anyone know the answer? >> she just shifted some in. >> there you go. >> there's no further change to manufacturing. are they going to have to raise prices because of what's going on in china? do we know the answer to that? >> i don't know the answer >> are you going to get hit by a bus when you cross the street
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later? >> i would rather -- hold on i would rather be in other places in technology like i am >> that's fine >> that are performing well, because as it relates to apple, i just don't know the ainto teno that >> you won't own anything with china risk >> i own the smh, how could it be china-proof when will you buy apple back >> not yet >> what's the level you're waiting for? >> there is no level i would not -- no. as i told you, you have a select -- >> there's no level? >> you have a celebrity group of technology holders >> do you believe that >> there's cook, cook's calling. >> you have a portfolio of technology holdings, key site, smh, microsoft, motorola solutions. if i lose one of those names and gain some confidence from what i hear from tim cook, i get some visibility on what the trade dispute is going to look like, and i understand what the path
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forward is going to be -- >> so you want all the answers before you buy got it you want all the answers >> i'm not afraid to buy high. >> buy high and sell higher. you wrote the book on it >> i'm not afraid of it. i'm waiting for cook moving the mac production, a small part of the business, admittedly, into china, that's a positive, and they won't be retaliated against by china and of course with their unique brand, they have pricing power, right? >> yes >> yes >> you don't think they have pricing power? >> they have some but not complete, because sales are slowing. >> who does? >> nobody. >> i'm going to broaden it out for a minute one of the catalysts was -- wha do we think about this story it relates to the broader buyback market
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decline and share buybacks deals blow to stock market, share repurchases recently contracted for the first time in seven quarters this has been a pillar of joe's bullish case when he's made it about the stock market buybacks have been the fuel for this -- gosh, i mean it almost feels like for a better part of ten years, a lot of other factors, obviously, but buybacks have always been on that list. >> it shrink the size of overall availability in the market if you're a company, are you going to buyback your stock in the quarter that we just experienced, understanding what we just had go on in the prior quarter also with the possibility, the "r" word is still out there? >> you can't afford to lose buybacks >> there's another target here, because we had tax reform, which are enabled repatriation $1 trillion came back. a lot of that money was used for buybacks we're coming off a peak as a result of tax reform buybacks are naturally going to go down as a result of less
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money being repatriated. but still having, what, $200 billion down from $223 billion -- >> still a lot >> still a lot of buybacks companies are shrinking their float. if it's the start of a trend, then it's something perhaps to be worried about and in an already somewhat uncertain market -- >> i would posit, back to you, scott, a lot of these companies that are borrowing at basically zero overseas have even greater incentive when they decide to commit that capital here, because of the borrowing costs overseas being so cheap. >> i think one of the issues also -- there are actually two issues one is that buying back stock clearly drives your earnings is it just coincidental that buying back is -- and it's de minimis right now, but if the trend conditions, what's that going to do to sp earnings and then the pe valuation. it could be meaningful i don't think it will happen but you have to look at that chart next to m&a.
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u.s. m&a in the second quarter was $660 billion, down 3% from the first quarter. your talking about record quarters that also shrinks the market and drives the need to put that capital into other stocks. so i think we're okay. >> also remember, we're at an all-time high. so perhaps companies for the first time in a long time are starting to think about the valuation of their own stocks. >> hasn't stopped them before. >> i understand that but they also weren't spending money on other things. we haven't seen a capital segment really pick up since before the crash so it's conceivable that they begin to -- they've hired more people, we know that >> are they going to start hoarding cash because they're worried about where they are in the cycle? >> they already have a lot of cash companies have a lot of cash >> it wasn't some thought it would be, if the money isn't going towards buybacks, maybe it's m&a as steve says >> there's still a very defensive mindset in the
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marketplace. yesterday did nothing to change that dwechs miefensive mindset yesterday afternoon the market rolled back on change. you saw this shift, the market lifted why did it lift? because reits, consumer staples, all the defensively oriented names came back once again >> the reit eff is leading today. >> and that's right back where we are today gold tire, it's a defensive mindset. >> what do you make, rich, of the defensive posture of the market, gold up, bonds up, bond proxies up >> we're still invested in equi equities, we haven't changed our allocation there's two conflicts for the market one talks to the bond proxies being elevated that's the overreliance on the fed to be overly accommodative the second thing is tariffs,
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where, you know, we had the g20 resolution, but all the economic and strategic tension still exists and we don't see a resolution until 2020 so this sentiment in the market now, relying on the fed to be very aggressive, we don't think that it's going to occur that way. >> you think the market is ahead of way >> way ahead of itself on the fed. we have an incredible environment economically right now. sure, we're growing, but we're slowing. we're not going into recession i don't see the fed cutting aggressively like futures are suggesting >> do you think if the fed cuts in july, this month? >> i don't think so. i think we get 25 basis points at most this year. >> for the rest of the year. >> and the market is cool with that >> there is record low unemployment we have a million unfilled jobs in this country. we're still growing. i don't see a reason for the fed no give us insurance cuts here >> i say 50/50 i used to be with you and say it's not going to happen i think it's 50/50, just because
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that's the body language >> the ultimate powell put >> and what powell himself, when his words are more or less an insurance cut, scott, i don't know how else you read what his latest statement was other than that, steven he put it out there. the fed chairman himself this isn't us parsing, you know, through a variety of fed speakers this is the chairman himself that told us he's going to be preemptive here. and i think that means that that's why the market has basically 100% chance for july and four cuts in the next year >> it's a good debate. if rich is right, you and the market are going to be disappointed >> i think if earnings come through, you don't need cuts >> what happens if the bond probsties, if the economy is stronger than anticipated and the fed is moving from very accommodative to just neutral, all of a sudden you have a good economy, the bond proxies are
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offsides because everyone is thinking the fed is going to be very aggressive in cutting, so be careful what you wish for here >> how do you change the impact of what's going on overseas? a negative 37 ten-year for germany. so how does the fed respond to that because in a sense, they have to >> 197 on the ten-year >> lower than the s&p 500. >> the u.s. is the only place you can get yield today. $13 trillion in negative debt. the u.s. is where all the money is going if you're a global investor, you're in the u.s. two weeks from earnings season, one analyst made a big call on a key player in the sector that's next. jon najarian is watching unusual options activity plus the quarterly report, as we hold the investment committee's feet to the fire see where they went right and wrong. and what they're doing now
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before the break, our data partners at kensho on what happens after tech gains 10% in a month. the numbers show a monthly later, tech is up 78% of the time by an average of 1.82%. healmore, go to cnbc.com/kensho. "t hftime report" with scott wapner and the traders is back in two minutes tell him we're flexible. don't worry. my dutch is ok. just ok? (in dutch) tell him we need this merger.
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welcome back, everyone i'm sue herera here is your cnbc news update at this hour. the house ways and means committee filed suit against the treasury department and the internal revenue service as it seeks president trump's tax returns. the committee filed the lawsuit after treasury refused a request for tax information about president trump. america's top diplomat in hong kong, curt tong, says the u.s. was disappointed to see violence at a government complex today but added he is optimistic about the future of the territory. >> there is some conflict, it's the struggle that makes me optimistic think about the history of america and about our constitution mistakes were made there was conflict but the intentions were good
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atlanta's city council has approved a more restrictive began on smoking inside restaurants, bars, workplaces, and hartsfield-jackson international airport. the ban covers cigarettes, cigars and e-cigarettes. if signed by the mayor, the ban will take effect on january 2, 2020 you're up to date. that's the news update this hour scotty >> we appreciate that, sue herera financials, goldman sachs says it's time to get out of one regional name. they've cut comerica to a sell it's our call of the day good franchise, wrong part of the cycle, they say, joe. >> play the regionals. >> i do. first of all,co m co-america ha underperformed significantly goldman talks about regionals being an opportunity, better geographically located, i agree. performance standpoint has done better signature bank is a name that i would look at. one of the reasons why i like signature bank is i think where we are in the cycle, with the
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margin pressure, you have to look at the real estate exposure based on geographics you want to be in banks that don't have the exposure to where real estate is in a decline such as new york. signature bank provides you that opportunity. i don't see the lift for co comerica . >> i think it's very tough, given where rates are and where the curve is, for them to make money. >> if you've cut rates, the fed is going to cut rates -- >> it's bad. >> you get a steeper yield curve. not necessarily bad. >> it's been bad >> margins can go up, right? >> hasn't that been the principal issue, long growth in the economy? >> long growth has been fairly funky, the shadow banking system, which has absorbed a lot of that. you just don't see the alpha really in the banks.
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if you have a hugely dedicated portfolio for some diversity, it can be there, but it can't be a big bet. >> we really like the money center banks there's a couple of reasons. one is, regulatory relief is reducing their expense lines but more importantly, the return of capital to shareholders is just incorrectredible right now. they're averaging 10, 11, 12% return of capital through buybacks and dividends their cash flow is very strong return on entquity is elevated. capital ratios are high. if you look at the money in the system, we have excess reserves decreasing at the fed. so the fed -- so the banks are pulling back capital they had on deposit and loaning that money out. so loan volume is increasing right now, which is another indication that the economy is actually stronger and not going into recession >> what are your favorite names, the ones you own >> jpmorgan, bank of america, and citigroup. you can buy iyg and get the mix.
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we like the banks because you have although interest rates >> jpmorgan cut their price target on co-america today too you have folks saying it's a nontouch the only one i'm really in, scott, as you know, is square. and i like it, i think the rest of them struggle up next, bill ackman's first half come back we're following the money. our leslie picker is, straight ahead. plus betting on a biopharma stock up 20% in a month. doc has the trade in unusual activities a sector check today, led by real estate utilities. those are the defensive plays leading the way. s&p down we're back after this. mars. $4.95. delivery drones or the latest phones. $4.95. no matter what you trade, at fidelity it's just $4.95 per online u.s. equity trade.
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like military plans with a special price on unlimited, $100 per line, and big savings on our best phones when you switch. that's verizon. welcome back to "the halftime report. traders are betting ameren's activity continues dr. j? >> we were lucky enough to get into amaren in february. now it's making another move $2.40, about 12 i wou.5%.
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traders are buying july 5th calls right at the money, these are they're at the money now they were buying the $21.50 calls, july 5th expiration, that's this friday, scott. employment data coming out that day too. obviously this one not being driven by employment data, but perhaps being driven by the possibility that somebody's taken a good hard look at the company. second one, this one's longer term, but take a look at this. russian stock, yandex, a play on the russian index, it's up slightly today, 1.24%. they're buying long dated calls, all the way out in january look at these january 45 calls right now. they've traded almost 10,000, a million-share equivalent that's way over the top, unusual activity in this name. doesn't get active much more than 3 to 5,000 contracts. to see 10,000, we bought this, scott, i'll probably be in these one to two months in the future.
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>> good stuff. bill ackman's pershing square fund posting strong returns in the first half of the year kind of an understatement. leslie picker following the money is with us live. >> an understatement indeed, scott. >> very strong >> yeah, closing out the first half of the year with some of the best returns in the entire industry, as pershing square is up 45.3% in the first six months of 2019, according to new numbers disclosed last night that's the best return he's ever posted since he began disclosing performance on a weekly basis going back to 2014 and it's a reversal from four consecutive years of losses. consumer names drove ackman's return, largely chipotle, which served 70% in the first half of the year restaurant brands hilton, starbucks, each up more than 30% as well. in fact all nine publicly disclosed names in pershing square's portfolio are in the green for the year if ackman is able to eke out
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returns that are just five percentage points higher by the end of the year, he'll have reached his high water mark, around 50% that means he'll once again be able to generate an incentive fee of 16% on any returns above 50%. most industry watchers have noticed that ackman has been quieter this year than usual, fewer public demands, fewer proxy fights but those close to the firm says he still has been active advising management in the companies he's involved in he wrote to greg hayes, ceo of united technologies, which had just agreed to ties with raytheon, he expressed his concern about the company's decision to sign a transaction with raytheon. instead utx stood behindis decision to merge. so far, that's the extent of their disagreement, at least publicly one might expect if ackman's portfolio continues to do this well, there may be less to fight about. the second that changes, we could start to see more activist
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action from ackman at least publicly, scott. >> you've been reporting consistently on whether it's the first quarter or a few months after that, how good his performance has been it reminded me of a conversation that he and i had had around my book when i was working on the book, and we were sort of talking about, you know, what the future was going to hold, this was coming off of the valeant debacle and the issues with losing money in herbalife i wanted to quote from a passage he quoted me, since he is quieter, this was a year and a half ago, reflecting on what was going to lie ahead for him the key is learning from your mistakes he told me, i had a very difficult moment in 2003 when we were short mbia and the stock was going up every day the company was all over us. they convinced eliot spitzer, the attorney general at the time, to investigate us. and i said at the time, this is a great experience, i will learn
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a lot from this. and i launched pershing square we're going to come back we'll be fine. now, six months does not a full comeback make relative to some of the issues that they've had over the last many years but he's on the path >> he's on the path. and i did add up the losses over the last four years, which again, you know, not quite apples to apples, but he is looking at performance that supersedes the losses over the last four years. doesn't quite recoup that money, because of course there have been redemptions it's not quite the same investor pool that's been with him the last five years or so. but it's worth noting, this is a manager who takes big swings he has a very concentrated portfolio, all equity names. it really requires those names to do well and go in his favor this year, they have, so far >> when we discussed what was going on, you expected that he was going to have a rebound of some sort, i recall you saying
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at the time. >> so his first fund got them, had to shut down because of performance. however, he did eventually make investors whole. he's had this trial by fire a few times of this but look, you can't deny that he's a very smart guy, that he just had to rein himself back in, and he did that i think every huge fund manager that i know does do behind the scenes activism, does talk to the companies. it's the public stuff that's a distraction. you also had some personal distractions, to be fair, right? went through a divorce, got remarried. now he's happy in life that means he's happy at work. he came back >> one of the things that when he was on with us, we challenged him, he seemed to be spending so much mental capital and not getting the return on the investment and now he's able to spend the mental capital and get the return on investment i think he's been very successful in navigating a public relations pivot
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look at how he handled adp think about the entire saga with adp. think about where adp is right now. he still has i believe somewhere around $650 million invested there. but he lost the vote he said, okay, i lost the vote, but i won. and he did win he won where it mattered most, in the return. >> as a hedge fund investor who ran funds for a living, i would look at it and say, okay, where are those returns? i would dissect the returns. what's amazing to me, as you mentioned -- now, the market is up, close to 20%, so you would expect, most of them but in terms of how much those companies are up, and how much each one, with the exception of maybe one there, is outperforming the s&p. >> but he's also owned defensive names and consumer names it's not as if he owns the faangs he owns fannie mae and freddie mac. he does a lot of research, nobody doubts that, he makes big
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bets and big decisions and he's very arrogant, i wholeheartedly believes in his positions, he's supportive of them this is a great result he's got to continue to do it, right? >> i don't know how many other managers would still be in business four years, major outflows you're going to a family office. >> 50% high water mark too obviously there's some patience and kind of love for the game at stake, if you want to stick it out and see this thing through rather than shut down again. >> one of the biggest changes, you say know as well, in what he said publicly too, and he may have said it on this program, no more big public shorts that's just not going tohappen again. maybe he'll short something again and he'll do it quietly, and the whole world won't know about it, and all of the reasons why, you know, it's a loser and all of that. he's just not going to do that anymore. >> it will be interesting to see too when the market turns and we're no longer in this bull market environment, whether we do start to see more public
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shorts, whether it's from ackman or einhorn or some of these other managers who are famous for them >> maybe active management isn't dead just yet. >> einhorn is having his best first half ever. >> he's gone up 17, i think. >> he is as well, yes. >> leslie, thanks. that's leslie picker the quarterly report is ss f, a rundown of wins and loesrom q2, "the halftime report" is back after this dear tech, let's talk. we have a pretty good relationship. you've done a lot of good for the world. but i feel like you have the potential to do so much more. are you working for all of us, or just a few of us? can we build ai without bias? ai that fights bias? ai that helps us see the bias in ourselves? we need tech that helps people understand each other. that understands my business. dear tech, dear tech, dear tech, dear tech,
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hi, everybody, here's what's coming up on the exchange. nike caught flat-footed with its planned fourth of july shoe. we'll have the details behind the latest controversy investors are cheering the trade truce reached by the u.s. and china at the g20 yesterday is it a reason to sell risk rather than turn bullish the rolling stones have gone from a 19th nervous breakdown to preparing for retirement the latest coming up in rapid fire today see you then that and more is ahead on the exchange scott? >> thanks, kell. we're taking a look back at some of the traders' most memorable calls from the second quarter. >> you're seeing biotech taking a big hit. >> we're buying home depot, down to a level of support.
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>> with interest rates down, we think that's good for the housing market >> abbott labs, mckesson, nothing to do with medical devices. that's where the opportunity is. >> all right weiss, you first i wi illumina up 16%. do you still own it? >> i do. look, right now, bios is the key, i would say the key, it's important. that's been referred to european commissioner because of antitrust. but i think it passes. i think they make the acquisition. and there's no real competitor in the space so i love the stock. >> home depot, up 9% since, stay with it? >> definitely. home depot is one of the few retailers that people actually like to go to. they have the whole contractor business with the housing stock in america having aged and appreciated, it means more renovations, more improvement. we think that there's many years
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of double digit growth ahead >> joey, mckesson, 19% >> i'm staying with it i think steven was with me on this as well health care provided an opportunity. you had the chance when you had the selloff related to the political issues issues in wash, stay with it though. >> well, of course some of the picks haven't quite worked out just yet. >> i got to go >> xpi still like bio tech, eve though i own some individual ones, i'd buy the xpi. >> frc first republic, a lot of new millionaires in silicon valley. >> fortinet. >> why 6% down on the xbi? >> i still own the xbi i own a couple of bio tech stocks i'm sticking with it i still think it's a great area of growth, a lot of pharma companies raise prices on a lot of drugs, so they're not worried about legislation. >> first republic's down 5%.
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what do you do >> yeah, well, we still own it what i said is true. there are a lot of new millionaires in silicon valley they cater to the high net worth client that market is growing their organic growth has been strong, and we still believe that over the next few years that this is the stock to own. >> joe, fortinet, 17%. >> really bad quarter was reported. >> you still in it >> no, got out of it experts as it relates to earnings have been reset stock at 78. i wouldn't sell it here. i think you'd get some upside. >> okay. coming up, crude oil, getting crushed as slowdown fears weigh on that market seema mody and the futures now team have more there hey, seema. >> oil is down more than 3% today as demand fears weigh on the market our traders are scott nations and jim murios opec says it's going to continue to cut production, so why is oil down today >> i think there are a couple of reasons.
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one, fundamental weakness across the world, also russia was not really on board with continuing the cuts, and i also think there's something else going on. i think now that iran has exceeded their stockpile limit under the old treaty with us, i think the rest of the world sees that the way we're approaching iran is wrong. i think they're now going to establish some sort of separate peace with iran. they're going to say iran, if you stop now, we'll ignore the sanctions and we'll continue to buy all of your crude oil. that will bring another 2.2 million barrels a day onto the markets. >> jim, are all of these demand fears based on a potential global slowdown, or is there another story line keeping crude under pressure here? >> well, there's always a lot of story lines that are pushing crude back and forth that's why i think to me it's always more of a technical story, and we talked about on twitter yesterday when it went above $60 a barrel for not even a full cup of coffee, and then was rejected i thought that was a very negative occurrence and weakness today, and when it took out
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friday's low of 5775, i think it heads to 55. i think it's going lower. >> we will leave the conversation there jim and scott thank you, for more futures now, check out our web show we will be joined by pnc's co-chief investment strategist jeffrey mills who says now is not the time to get greedy, plus why gold could be headed for fresh six-year highs all of that and more 1:00 p.m. eastern, futures now, go to cnbc.com final trade and the halftime back in two minutes. ♪ ♪♪ ♪♪ ♪♪
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a key trend suggests a summer rally is just starting. go to tradingnation.cnbc.com now. [ dogs barking ]
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report we're answering your questions now. first up kari fire stone from you from chris in new jersey you ready? >> yeah. >> what's going on with bio haven? >> bio haven went down the reason it went down is because they did an offering correct, they did an offering when the market thought it was going to get bought out. this is a company -- they've filed the job with the fda that's a very good sign. we think it's going to get approved, but the market was anticipating a buyout. what they got is new stock i hold it. >> rich for you from david in orlando, florida, what are the chances for an end of summer selloff? >> in the next 60 to 90 days, the market's going to realize that a trade deal is not happening in 2019, and that will be pulled out of the market as well as the fed will not be as accommodative as the market is looking for. >> gee, thanks going to be a great summer >> all right, less than 30 seconds, final trade, what do
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you go >> boston scientific, lots of products, a lot of organic growth we'd buy it right here. >> the joes trmb, software name. >> united air requesting to goi great quarter. >> cyber, logistics, everything. "the exchange" begins right now. >> thank you, scott, hi, everybody, here's what's ahead of us. second half, headwinds, european tariffs, a slowdown in buy backs zero expected growth in this earnings season and global hot spots. will one of those dominos eventually fall? we'll get into all of that. and on the wrong foot, nike is finding itself in the hot seat over a new shoe that it has now pulled why does the company continue to get itself in these controversial situations, and what's it mean for the stock plus, biggest is still big when it comes to auto sales. is bitcoin getting ready for a bust. and the rolling stone knows who their audience is thes

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